The Russian Ministry of Agriculture has proposed a temporary ban on sugar exports until August 31, 2024, to manage domestic supply and stabilize prices. This measure, which excludes exports to Eurasian Economic Union (EAEU) member states, arises from a combination of factors including increased production, expanded export geography, and recent challenges with logistics, payments, and insurance. Russia is projected to produce 6.8 million tons of sugar this season, marking a 9.8% increase from the previous year due to a significant sugar beet harvest. The proposed ban aims to balance domestic needs with the capacity to export approximately 200,000 tons of sugar, primarily to EAEU countries, ensuring stable market conditions and adequate end-of-season reserves.
Russian sugar has become more accessible on the global market, leading to an expansion in its export geography, including new buyers like Turkmenistan, Afghanistan, Turkey, North Korea, and Senegal, alongside traditional markets. The resolution to restrict exports, except to EAEU countries, is influenced by Russia's commitments within the union and the need to fulfill contractual supply agreements. The move follows a significant increase in Russian sugar exports, which surged more than threefold compared to the same period last season, thanks to improved logistics and competitive pricing. By season's end, Russia plans to export an additional 200,000 tons, considered optimal given domestic consumption requirements and the goal of maintaining stable sugar stock levels.
The draft resolution by the Ministry of Agriculture essentially channels the planned export volume of sugar, pegged at 200,000 tons, exclusively to EAEU member states, in line with Russia's obligations to its partners in the union. This regulatory measure is intended to satisfy both the forecasted demand of EAEU countries for sugar and to preserve equilibrium within Russia's domestic market. With significant quantities of sugar already exported to EAEU countries like Kazakhstan, the proposed export ban reflects a strategic decision to prioritize regional commitments and domestic market stability over broader international exports.